Show Summary

Ken Channell, Co-President of HomeVestors of America, the “We Buy Ugly Houses” folks, has had the unique opportunity to study thousands of real estate professionals – and knows, perhaps better than anyone else, what it takes to be successful. He also had the opportunity to work with industry legend Ken D’Angelo, founder of HomeVestors, across multiple decades. HomeVestors is nearing it’s 60,000th house purchase, and Ken’s insights into the most powerful home buying system that’s ever existed will give you a peak behind the ‘ugly curtain’. Don’t miss this episode of the FlipNerd.com VIP Interview show to learn more about Ken Channell, learn about the HomeVestors system, and discuss some common traits that determine whether a real estate investor will be successful or not.

Highlights of this show

Meet Ken Channell, Co-President of HomeVestors of America.

Learn about the legacy of the late, Ken D’Angelo, founder of HomeVestors.

Discuss what makes a real estate investor successful.

Learn more about HomeVestors, the “We Buy Ugly Houses” folks, and it’s current rapid growth.

Listen to the Audio Version of this Episode

FlipNerd Show Transcript:

Mike: Welcome to the FlipNerd.com podcast. This is your host, Mike Hambright. And on this show I will introduce you to VIPs in the real estate investing industry, as well as other interesting entrepreneurs whose stories and experiences can help you take your business to the next level. We have three new shows each week which are available in the iTunes store, or by visiting FlipNerd.com. So without further ado, let’s get started.
Hey it’s Mike Hambright with the FlipNerd VIP show. Today in our episode we have a great special guest, he’s a great friend of mine. Ken Channell who is one of the co-presidents of Homevestors. The We Buy Ugly Houses folks. I don’t talk about it a lot, but many of you know that I’m also a Homevestors franchisee and operate under the We Buy Ugly Houses brand. But Ken has been involved, really since, almost the beginning he’s watch the franchise community by almost 60,000 houses at this point. Generally one house at a time.
Ken started his career with ERA and was hired by Ken D’angelo who is the founder of Homevestors 20 years prior to starting at Homevestors. So he’s been in the real estate space for a long time, has seen a lot of successful people and a lot of people fail. Ken has a masters in divinity from Duke and degrees in sociology and anthropology. And specifically, Ken has learned what it takes to be successful in real estate. A lot of that we’re going to talk about today. So before we get started, let’s take a moment to recognize our featured sponsors.

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Please note, the views and opinions expressed by the individuals in this program do not necessarily reflect those of FlipNerd.com or any of its partners, advertisers or affiliates. Please consult professionals before making any investment or tax decisions as real estate investing can be risky.

Mike: Hey Ken thanks for joining today.

Ken: Thank you. I’m so happy to be here Mike. I appreciate you inviting me.

Mike: Yeah glad you’re on the show. So you’re definitely somebody that a lot of folks admire and look up to. And I think one of the things that has always intrigued me about real estate investors is, there tends to be a fairly high failure rate. And that’s because a lot of folks maybe just don’t [sic] go about it the wrong way. So I’d love to pick your brain today on what makes somebody successful in real estate? But before we get to that, why don’t you introduce yourself a little bit more and talk about how you got to where you are today?

Ken: Oh thanks so much for asking. You know, I’m so fortunate to be where I am today because my background, as you gave a little bit of that introduction there, was that I was teaching sociology and anthropology at a community college in a place called Belle Glade, Florida which is in the Everglades. And I realized that they would give me a piece of paper that would show me that if I kept doing what I was doing for 20 years how much I’d be making. And at that point I was living on a boat, and I had this feeling that that kind of money wasn’t going to pay for the toys I appeared to be interested in. So that’s when I got a real estate license.
I joke sometimes that I considered becoming a psychiatrist, but I chose real estate and I’ve never had a want for crazy people. I’ve always
[inaudible 0:04:02]. Real estate is an amazing space because of the people it attracts, and because of the opportunity that it provides. Because there is just so many ways, as we know when we go to these trade shows, we’re just amazed at all the different ways that people are figuring out to make money…

Mike: Right.

Ken: …in real estate. So I sold real estate in Gallery of Homes. Gallery of Homes was the first real estate franchise started in 1955 buy a guy who worked at Kodak. And he just came up with this idea that you take eight by ten pictures of houses, put them up on the wall and you have a gallery of homes. So this was in the mid 50’s though. And so when people would say, “I want to buy a house,” he’d invite them into the office and show them the pictures. So I did that in January of ’77. And I actually sold real estate for ten months. And I think I had 11 closes. So I mean it had some significance.

Mike: That’s pretty good, yeah.

Ken: I was hired them by the Gallery of Homes to sell franchises. And they moved me to Dallas, Texas and I came here in February of ’78. And in May of
’78 I went to a meeting in Houston for the Texas Association of Realtors and that’s where I met Ken D’Angelo. And to make that story kind of short, he hired me in June of ’78 to be his trainer because he had bought the rights to develop ERA as really a master franchiser in Houston, 26 counties around the Houston market. So Houston and Beaumont.

Mike: And for those that don’t know, some of the younger guys on the show, ERA was… Was it the largest brokerage in the country at that time?
It was a much bigger deal back then than it is now.

Ken: Yeah. Well at that time the exciting thing in the Dallas market was that Ken and about 30 other Red Carpet, which is another early real estate brokerage franchise, converted to ERA. So that was big news and that’s what got Ken so excited.
ERA was probably, in the 70’s, number two behind Century 21, was always kind of our nemesis because they spent so much money on advertising. But what a lot of people don’t know is that ERA has more offices today, internationally, than they do in the US. So they’re part of that whole
[inaudible 0:06:32] organization with Coldwell Banker and Century 21. And so they’re the smallest US version of that.
So I went to work for them, spent four years in Houston training real estate agents. That’s really got me, kind of, coming back to the psychiatry. That’s how I got started on personality, which I’ve spent 30 years studying. Because I couldn’t figure out why I would have 20 people in class, and about four of the 20 would go out and make some money listing and selling real estate. And the other 16 did something, but it wasn’t make money. And so that’s what got me interested in why people are successful and why they do what they do.
So I, at the end of four years, Ken had come back to Dallas to run his business in the brokerage side of the business. And I went to Kansas City which is where ERA was based at the time. And in 1987 I became Vice President of marketing for ERA and I had that position until ’96. ’96 was when, at that time, a company which became Realogy bought Century 21 in July, ERA in February of ’96 and Coldwell Banker in May of ’96. So they bought those three franchises.
And so that’s when I decided that I wasn’t… They told if I wanted to keep my job I would have to move to New Jersey and I thought, “I just built a log house in Kansas,” and I told them I thought it was an intelligence test and I didn’t want to flunk it. So I didn’t move, but two years later I ended up coming to Dallas. So that’s how I got to Homevestors. Ken started calling me probably around ’93 telling me he wanted to franchise this idea. And so in ’98 I came down. When I got here we had 23 franchisees.

Mike: Okay. And so talk a little bit about Ken D’Angelo. I mean he’s… I’ve been with the Homevestors system for nearly six years and his legacy lives on larger than life. Unfortunately he passed before I came into the system so I didn’t have the chance to know him, but I feel like I know him through stories that you all tell. But talk a little bit about Ken and how he got to the point where he decided to start Homevestors.

Ken: Yeah. He was such an entrepreneur. And he got his real estate license as soon as he legally could. And we think that some time around ’74… ’73,
’74, he went on an appointment to list a house. And he explained to the lady that you put the house on the market, you put a sign in the yard and it takes about 90 days for somebody to write a contract and then it takes 45 days to close it. And the lady said to him, “You don’t understand, I want to sell this house today.”
And so he bought the house. This time, in ’73 or ’74 an East Dallas house was like $40,000 right? And so if you had both the listing and the sale and made six percent on it, you made $2,400. Well he bought this house, rehabbed it and sold it and made… We don’t know exactly what, but it was around five or six thousand. So it didn’t take Ken long to weigh those two choices and say, “Oh $2,400, $6,000.”
So when I met him in ’78, he told me then, he said, “You know, if I can just find a way to finance houses that need repairs, I think I’ve got an idea here.” And so he just kept working on this. I would talk to him in the late 80’s and he would be working on this whole concept of how… His whole goal was how could he teach other people to do what he had figured out how to do? Which was to buy wholesale, rehab residential properties.
So now here we are almost 60,000 houses later. And it’s all because Ken had a vision that he could share what he had learned with other people who wanted to do this. Because he’s like you and me and everybody else who even mentions that they happen to be in real estate right? And you get that response, “Oh I’ve always wanted to do that.” That’s a real common response. It’s because real estate is so attractive as an opportunity.

Mike: And as far as the branding, the We Buy Ugly Houses things. That’s really… Whenever we tell people that I’m with Homevestors and they say who? And you say, the We Buy Ugly Houses folks. Oh okay, okay. What did you say before? Never heard of that before.
So obviously the branding has played a huge role, and that was part of the genius of Ken D’Angelo with coming up with that brand, which confused a lot of people early on, but after all this time it’s really made an impression. Can you talk a little bit about the importance of, kind of, that piece in the legacy of Homevestors that brand makes?

Ken: I was so fortunate to be here when he came up with that idea because… And the way that happened, Mike, was that the franchisees, which were primarily in the Dallas, Houston… We had one franchisee in Kansas City and one in Delta at that time, right?
And so they would call Ken and they would say man… because we had a white sign that said we buy houses. Green letters on a white sign. We buy houses. And a phone number. And they would say, “These people call me and they tell me they’ve got a $100,000 house and they’ll sell it to me for
$90,000 and I can sell it and make a profit.”
And we said, “No, that’s not what we do. That’s called a listing, and we don’t do that.”
And so that’s when he started figuring out; how do I communicate that people can sell us a house that needs repairs? And so that evening, worked on that all Summer in ’99. And he came up with what eventually became We Buy Ugly Houses. A lot of different concepts, but that was kind of what it became about. And he also came up with that yellow billboard with that red tag line with the phone number. And that’s what’s so amazing is we’ve had over a million people dial that number in the 17 years that we’ve been in business. Which is just a phenomenal thing, right? When you think about it. That you can have a number that people would call. So we launched it in Waco Texas with about three billboards. And after about a week the franchisee and Waco called Ken and said, “They’re calling.”
And that’s all Ken had to hear and he was in. He said okay we’re doing it. So we launched it nationally in San Antonio at our convention in 2000. And so the rest of it’s history; is there’s been more people aware of the real estate investment business because of that brand, I believe, than anything else. Any other single thing that’s ever happened in this space.

Mike: Right. Right. And can you talk a little bit about Homevestors in the context of it being an organized system in a space where most folks are independent and maybe more of hobbyists. I mean there’s obviously a lot of successful independent people that have built their own brands and have figured out lead generation. But there’s a lot of folks, clearly the majority of folks, that are doing this as independents. And they don’t understand, maybe, necessarily the need for a system or a franchise or things like that.

Ken: Right. And so Ken, he would tell me, I’m fortunate because I sat in more classes that Ken taught than anybody else because I was here when he was teaching the classes. And so he believed you had to have four things for this to be successful. The first was a brand. And we have the strongest brand in the space, no question about that.
Second is a system. And we have a system for buying houses at a price, that when you sell them you make a profit, most of the time.
And then we have, he believed also that it was important that we build a network, which is what’s going on right now. When we’re in every major market, which we are now in all of the top 25 markets except one, that we’ll be able to do national broadcast campaigns which will even more revolutionize the brand when you have that. That’s the network.
But the most important component that Ken understood was that he needed to get real estate investors to work as a team, which is contrary to everything in their DNA. I sometimes joke that’s the equivalent to getting eagles to fly in formation. You know, that’s not what they do. So on the one hand, the people that are attracted to do this are extremely entrepreneurial. And so over time just like you they’ve learned that, if you come to a meeting and share ideas and get ideas, that you leave that meeting a better person than what you came there as. So those four components, the brand of which is by far the leading edge of that just simply because it’s so well known.

Mike: Right. Yeah and I think one of the benefits of… We talked a little bit about folks that come in that are successful. Whether they’re coming into Homevestors or even independent folks. What are some of the traits that you think make people successful as real estate investors?

Ken: Yeah. So I believe, as Ken believed, the number one thing that will make you successful is for you to have a passion to do the real estate investment business. If you don’t have that, the real estate investment business will win, and you will lose. Because it’s not… In some ways I think you could say it’s a simple business, but it’s not particularly an easy business, because there’s certain things you’ve got to develop a discipline for. And so passion exceeds everything. Ken used to say it this way, he would say, “If you pull up in front of a house that you know that if you can buy it, you can make money on that house and you don’t kind of get a little bit sweaty palms, then you may not be the guy.”
Because it’s just that, it’s the thrill of the chase. It’s one of the interesting conundrums in a way because a lot of our guys are way better at buying houses than they are at selling them, just simply because they love that opportunity. And so in addition to that, because we’ve really used a profile system which I’ve developed over the years, I know the other components. The other major component is focus. And passion generally promotes focus. But the ability to focus. Because as you know, there’s probably no business where there is as many distractions as there are in this real estate investment space. I mean there’s so many different things you could do and get after.
Then I think the second thing is to have that ability to want to be a part of a team. To think that you would be better being part of a team than not part of a team. That’s a lot about how you think. And you think team, it definitely is an asset in our system anyway. And then the thing that seems to be most common among our successful franchisees is that ability to get results and to relate. The balance between those two things. Because I always like to say that the focus will get you to the appointment, but it takes the ability to relate to turn that appointment into a purchase.

Mike: To relate to sellers.

Ken: Yes.

Mike: Yeah. So empathize. And yeah.

Ken: Because almost everyone that we work with… Because work with a particular segment of the home owners in America. And so almost all of them have things going on. And so if you’re willing to listen to their story, as you know, then that makes a huge difference. You’re just treating it like,
“Oh it’s just something I’m going to buy and make money on I don’t care about you.” Then they pick up on that pretty quick.

Mike: Yeah. Yeah. And I think one of the things that’s a little bit of a misconception, and you could blame it on the weekend boot camps or the gurus that have kind of over-sold the dream or things like that is, so many folks don’t realize that even if you’re not part of the Homevestors system, if you’re an independent person you have to have a band, you have to have a system. If you want it to be more than a hobby and you want it to be a business you’re going to have to build a team. It’s all those same things that Homevestors offers as well. But it’s just kind of packaged to where that person doesn’t have to go figure all those things out and continue to work to try to stay ahead of the curve on.

Ken: Yeah. And that whole thing we talked about earlier about sharing as a team is a lot more effective and efficient if you have a common system. Because when you meet with people from all over the country, which we do at our events right?

Mike: Right.

Ken: You get people there from all over the country. And you learn things about how they’re using that system that help you in your implementation of the system.

Mike: Right. Right. And there’s no doubt about it. Most real estate investors, certainly in any particular geography, do not share ideas. They don’t share learning experiences, they don’t share deals. All those things. Because a lot of folks tend to have a scarcity of mentality. Or they’re afraid that somehow that will cost them. So very unique in that manner.

Ken: Yeah. And every training class I always say to them that if you are talking to other investors in your market and they tell you to do something, if you do 180 degrees from what they tell you, your chances are much better.

Mike: That’s probably right. That’s probably right.

Ken: And I see those heads nodding. Especially if they’ve been in the space any length of time then their head nods.

Mike: Yeah. Yeah. Well talk a little bit about… So you’ve developed kind of a proprietary system for analyzing people’s strengths and weaknesses. I know exactly what it is, but I don’t know how to describe it. But in many ways it’s like the Myers Briggs or some other things for some other folks out there that try to not necessarily tell you your strengths and weaknesses but more of your tendencies so that you know where there might be some gaps, and if you’re going to build a team you should build around. Why don’t you talk a little bit about that and how it plays such a big role as a part of the Homevestors ecosystem?

Ken: Okay, you’re back?

Mike: Yeah. Sorry.

Ken: We had a little pause there.

Mike: Yep.

Ken: Okay so I’m going to talk about how this all came about. When Ken and I went to Houston… Can you hear me okay now?

Mike: Yep.

Ken: Okay. When Ken and I went to Houston, we recruited a Century 21 broker and he wouldn’t hire a real estate agent without giving them a profile. And so he introduced me to the idea and I took this profile. I guess I was probably about 38. And I instantly latched onto it. Because I went, wow this is impressive. Because my profile is that I’m a person who is very interested in why people do what they do. And so it was a tool.
So when I went to ERA I had the opportunity to have results of all the people on the executive team. And I would sit in the executive meetings and watch people’s behavior. And it was almost like sonar, because I would look at the profile and I would watch what they said or did or didn’t do. And so I began to get this picture in my mind of how you could translate that into team building. Because that’s why it becomes so important. There basically are four things you’ve got to have in any business to make it successful. You’ve got to have production, somebody has got to sell something. Nothing gets sold, we don’t have anything to talk about because we’re not in business long, right?

Mike: Right.

Ken: And then the second thing you have to have is innovation. Because in every production opportunity is an additional opportunity if somebody sees it and they go what if we did this? And the classic case for us is like when we’re on an appointment to buy a house, if we drive around three or four blocks we probably see another house that is a potential what we call a [digly]. So that’s innovation.
And then the third piece you’ve got to have is administration. Which means you’ve got to have somebody in the real estate space, especially. Somebody’s got to cross the T and dot an I. Because you can get yourself in way more trouble than you want to be in.
And then the last piece is the integration. Is the team, is the pulling everybody on those three other categories so that we work together. So most franchisees, they come to us. They’re really good on the production side and on the relating side, on the team building side. I mean it’s almost classic. You come to the classes so you know when you look on those cards and you look for a green dot which means they would be good at crossing T’s and dot I’s. It’s a rare commodity.

Mike: Yeah.

Ken: And so they need to hire somebody what we have traditionally called a coordinator. And they can change your life because when you’ve got somebody covering the details it frees you up to be more successful at what you do. Which is to meet with people and to help them get solutions to their problems. And then the franchise, one of the powers of the franchise and the team is it’s constantly innovating. I mean you’ve been a leader in that regard of looking for new ways to take advantage of the business. And so those four things, when we give you the profile we look at what you bring to the table. Every new franchisee takes this profile. We look at it and we go okay this is where this guy’s going to need help. Another classic example would be we have guys who are really good at running businesses but they are not that good at buying houses. And so they need to hire somebody to buy houses. And so it’s that tool that helps us help a franchisee to build a successful business.

Mike: And it really helps them understand, back to building a business, to use that word very literally. Because a lot of folks that are in real estate in all honesty treat it more like a hobby they have. And it’s not that you can’t have another job or another business and do this. But if you planned to just figure it out in your spare time, it really is hard to get it beyond a hobby. And until you kind of look at it as a business and understand what role you play and the other roles that have to be played. Whether you can actually serve those or not may be a different story but it really forces folks to treat it like a business right?

Ken: Yeah. And so as you know I’ve been fortunate that I meet with every new franchisee and talk to them about their profile and what they’re going to have to do to build a team. And so what I’ve learned in that process is almost everybody who gets in this business wants to have financial freedom. They want to be able to have a business that allows them to do what they want to do when they want to do it. Well, to achieve that, it has to be a business. You’re never going to get financial freedom treating it as a hobby. I mean it can’t happen. And so we’ve, I think, done a great job of making it easier for somebody to walk before they run. But eventually if you’re going to get what you want from this business, which is the ability to spend your time the way you want to spend your time, you’ve got to treat it like a business.

Mike: That’s right. That’s right. So what are some of the characteristics that you think of leaders in the Homevestors system? And it’s not always people that do the highest volume or win awards. I mean I always admire folks that have made the decision that they don’t want to chase higher volume, they want to have some balance in their work and lifestyle. And I’m one of those folks that I’ll always tell you that I aspire to have a lot more balance in my work and life, but I think that’s going to be a journey I’m going to be chasing for a long time, never going to get there. But I guess leaders come in all forms and shapes and the Homevestors system allows people to achieve different goals whatever those are. High volume or just lifestyle balance. Can you talk a little bit about some commonalities in folks, and it could even back from your ERA days. Of the folks that tend to be successful in real estate and real estate investing?

Ken: Yeah. I think about our two, kind of, top winners this year in 2013 production. One of them is in Houston, Ricky Williams and his whole mission is to involve his family in this business. So he has three boys and has all three of them working. Now not everybody has that opportunity. But it’s a great opportunity if you have it.
And then on the other end of the spectrum you’ve got a guy like Chas Carrier who is here in Dallas who’s been very consistent. Talk about somebody who’s been consistent. He buys 100 houses I think almost every year that he’s been doing this. And I remember the first time I met him and he told me that he had met his partner in Wharton, at the Wharton Business School doing an MBA. And I thought, “Oh okay so this business is changing now right? This is not a mom and pop kind of thing.”
And so what he’s done is actually to recognize what he’s good at and then to hire people to help him get that done. But then I think about a guy like our franchisee in Denver, Mike Hoff. Who just thrives on rehabbing higher end products, houses. He kind of is a designer kind of guy and he loves that looking for new materials and the whole thing. And so he doesn’t do as many houses. But he thoroughly enjoys every one he does. And then Alan Washer is another good example, who is kind of outside the box because he’s more of an analytical kind of guy but he’s always hired a buyer. But Alan loves going on soccer trips with his kids and riding his Harley. So he doesn’t do as many houses as he once did, just simply because he’s adjusted that lifestyle to meet the needs that he has to do this business.

Mike: Yeah. And I think it’s true that there’s a lot of Homevestors folks, and other probably real estate investors, that when they start in the system as time goes by the Homevestors business becomes a platform to other things. It could be property management, hard money lending, accumulate enough rental properties. Which a lot of folks in the Homevestors system got in the system to accumulate rental properties. And so you start to kind of have more irons in the fire than you initially do when you start the business.

Ken: Yeah. That reminds me, you say and that reminds me of JD Asbel who’s in Kansas City. He sent me a photo the other day when the temperature was minus 11 in Kansas City. On his mirror, on his rear view mirror. Well he has a beach house in Belize.

Mike: Oh yeah that’s right.

Ken: He goes to about four or five times a year. So that’s his payoff. Is that he gets to have that get away. And spend of the rest of the other time… I’ve just watched people have some incredible lifestyles doing this. In lots of different markets. That’s what’s exciting about it. Minneapolis, Boston, DC, Philadelphia. I can just kind of go down the…

Mike: Right.

Ken: West Palm Beach, Florida. That was amazing thing. There’s a guy Don Cameron who has been in this business a long time, became a franchisee and now is mentoring his team mates. Turning them into better Don Camerons, showing them the business. So that’s been the fun part of this to me. I’m much more on the why are we doing this and who is doing it? Than I am what we’re doing. I mean what we’re doing is important. But it’s exciting to me to meet people who take this idea and really make it work.

Mike: Yeah. And there’s obviously been some explosive growth in the franchise system over the past couple of years. Why don’t you talk a little bit about the journey over the past few years. Obviously there was a little bit of a transformation in the franchise model. And just where you see things going over the next couple of years? And in addition to where you see things going with the real estate market. There’s obviously a lot of changes and the retail market has gotten a lot better. Just kind of how that all works together.

Ken: Yeah. So if you would have been here in… If these people watching us would have been with us and you were here… Because you got in in the Summer of ’08 I think?

Mike: Yep.

Ken: Yeah. And so David Hicks and I took over as co-presidents the first of February in 2009. We owed four banks $32 million on 430 houses. I just looked a report today where we sold house number seven, which gets us down to six. So we paid off four banks. Actually in ten months that year we started in February and we paid them off in October. And now we’ve gotten rid of all the houses that we owned except six.
And so one of the powerful things about that Mike was that it really gives us empathy for franchisees who went through that same thing. Because we had a lot of them go through that. That’s been one of the fun things, too that we’ve seen in the last couple of years especially. Are people who got hurt in ’07, ’08, even in ’09, who have come back as franchisees and are being successful. So that’s been a lot of fun.
And so pretty much in 2010 because in eight to nine we had issues and didn’t sell a lot of franchises. But in 2010 we started offering what we called an associate franchise. Because we recognized that there were more people that would be willing to get involved at that level than in the full franchise, what we call a full franchise.
Excuse me just a minute I’m going to get some water. And so that really has exploded our network. Because we went, really, from at one point we probably had about 160 franchisees in 2009. And today we have almost 420. And so that growth has been significant. And the other exciting thing about that are the markets that we’ve grown in. Because we’re way more prominent in California than we ever were before. And so in the introduction to what we call, which was something that you pioneered really, is the development agent. Which is that we take the new franchisee and we team him up both from a coaching standpoint but also from a financial standpoint so that he gets coached by somebody who’s actually built the business.
So I think, again, that’s back to us having a system that’s going to be taught and supported by a person who has been in the field. So that’s been huge. I mean we’ve got the strongest team of development agents that exist in the market today. Who are really coaches and mentors.

Mike: Right. Right.

Ken: And that’s made a huge difference.

Mike: Yeah that’s really unprecedented. You have the cost of the franchise is about a quarter of what it used to be or a little bit more than that. And they get really kind of unprecedented support and it’s in a model where everybody wins.

Ken: Yeah. And the ball is really in their court because they can actually, through sweat of their business, lower their fees. And get a much better opportunity as they grow. Because we learn that in the first… What that would have been like 12 years and now we’re at the… Those first 12 years taught us that the up front is the key ingredient to whether or not a new franchisee makes it successfully.

Mike: Right. Right. Well let’s take just a minute Ken and tell us where you think Homevestors is going from here over the next year or two.

Ken: Well I just, I can’t see any into it. I think about the opportunity… If we can get people who are interested in being a real estate investor to understand the power of a brand, then I think by the end of this year we’ll be probably almost on our way to getting 600 and then it’s 1,000 is just down the road. And 600 is probably about the place where we start doing broadcasts, advertising nationally. And that’s going to accelerate the growth. Just simply because we’ll be a brand just like any other brand.

Mike: Yeah. And just like any network, it only gets better as the network grows.

Ken: Yeah. That’s right. That’s right. The opportunity expands.

Mike: Awesome. Awesome. Well hey Ken, thanks for sharing your insights and history. We got a chance to learn more about you today. We’re so glad you were on the show.

Ken: Thank you very much.

Mike: I know I’ll be seeing you soon personally. But we look forward to having you back on at some point.

Ken: I would enjoy that.

Mike: All right. Take care, Ken. Have a great day.

Ken: You too, buh bye.

Mike: Thanks for joining us on today’s FlipNerd.com podcast. To listen to more of our shows and hear from incredible guests, please access all of our podcasts in the iTunes store. You can also watch the video versions of our shows by visiting us at FlipNerd.com.